CUMPRINC function in Excel

Use

When you take a loan, the CUMPRINC function calculates the cumulative principal paid on the loan between the specified period.

Syntax

CUMPRINC(rate, nper, pv, start_period, end_period, type)

The CUMPRINC function (a Financial function) has the following arguments:

rate – Required. The rate of interest. It needs to reflect the period length e.g. if you have a annual interest rate of 12%, but pays monthly, like our example, the appropriate interest rate is 1% (12%/12).

nper – Required. The total payment periods till the expiry of the loan. These are numbered from 1 to onward.

pv – Required. The present value of the loan amount. Like in our example $100,000/-.

start_period – Required. The first period of accumulating interest payment, numbered from 1 to the end_period.

end_period – Required. The last month of accumulating interest payment (in the calculation), which is 12.

type – Required. Indicates payment to be made either in the start or end of the period.

Type Timing
0 (zero) Payment at the end of the period.
1 Payment at the beginning of the period.

Example

Suppose, you took a loan of $100,000/- to be paid off over five years. which has an interest rate of 12% per annum (1% per month) and installment is paid at the end of each month. By using the CUMPRINC function, we will first find out the total cumulative principal paid during the first year.

Note that payments period are numbered beginning with 1 and ends at 60, means in above example, 1 is assumed as the first month of payment and similarly 12 as the 12th month.

The total cumulative principal paid during the first year (from 1st to 12th month) is $15,529/-. In a similar way, you can calculate the cumulative principal to be paid for each  next four years.

Function Errors

Error Occurs 
#NUM! If rate ≤ 0, nper ≤ 0, or pv ≤ 0
If start_period < 1, end_period < 1, or start_period > end_period
If supplied type argument is other than 0 or 1.
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